Day after questioning ‘US firm getting subsidy in Gujarat’, union minister Kumaraswamy deflects

His remark comes a day after he reportedly raised questions about the US-based semiconductor manufacturer potentially receiving ₹3.2 crore subsidy for every job it creates in Gujarat.

BySouth First Desk

Published Jun 15, 2024 | 4:52 PM Updated Jun 15, 2024 | 6:37 PM

Union Minister HD Kumaraswamy

The newly appointed Union Minister for Heavy Industries and Steel HD Kumaraswamy has reportedly raised questions about the US-based semiconductor manufacturer potentially receiving ₹3.2 crore subsidy for every job it creates in Gujarat.

According to a Times of India report, Kumaraswamy said, “The new manufacturing unit will generate about 5,000 jobs. For this, we are giving them $2 billion in subsidies… If you calculate, that’s 70 percent of the company’s total investment.”

He was further quoted as saying: “I asked officials how justifiable it is to allocate such a significant amount of funds. Conversely, there are small-scale industries… In Peenya (an industrial estate in Bengaluru), there are small-scale industries. How many lakh jobs have they created? What benefits have we provided to them? I am contemplating these matters, such as how to safeguard the nation’s wealth.”

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‘Need to create jobs along with investments’ 

However, on Saturday, 15 June, speaking to the media in Bengaluru, the JD (S) leader said, he was misquoted, “I have not referred to any state. In future, I have to be very cautious.”

He further stressed the need to create more jobs along with attracting investments to the country.

“Why has our PM given me this big portfolio? Why he has confidence in me? It is a big responsibility that the PM has given me. My work is to bring investors in a big way. Not only bringing investors, but parallelly, we have to create more jobs. By creating more jobs, I have to come to the expectations of the PM,” he added.

Lauding Prime Minister Narendra Modi’s semiconductor-related initiatives, Kumaraswamy on Saturday said he will work towards fulfilling them through his ministry.

“Semiconductor is a strategic industry. It is a basic requirement for electronics and automobile manufacturing. Both these sectors generate lots of employment. I greatly appreciate the semiconductor-related initiatives taken by @PMOIndia and will work towards fulfilling them through my ministry,” Kumaraswamy posted on ‘X’.

Opposition backs the question

Shiv Sena (UBT) leader Priyanka Chaturvedi, took to X, claiming that the point made by Kumaraswamy was very valid.

She wrote: “In Gujarat, promise to create 5000 jobs, subsidies worth $2 billion given to US based semiconductor manufacturer. For each job created GoI has given a subsidy of ₹3.2 crores.”

Terming as “unjustifiable” the central government subsidy given to US-headquartered semiconductor maker Micron for every job it creates in Gujarat, Karnataka Minister for Large and Medium Industries MB Patil on Saturday said Kumaraswamy’s question on this matter is appropriate.

“If this is applicable to Gujarat, then the same formula should be followed for other states to create opportunities,” said Patil.

He expressed his opinion in a post on ‘X’, seconding Union Minister Kumaraswamy’s remarks.

“Micron, which plans to set up its unit in Gujarat (Sanand) with an investment of $2.70 billion, is expected to create 5,000 jobs. In return, the company would receive $2.0 billion in incentives (50 percent from the central government and 20 percent from the Gujarat government). The logic behind this is not justifiable,” Patil quoted Kumaraswamy as saying while addressing JD(S) workers on Friday.

Patil also remarked that if a company is given this much incentive, it could be considered a public sector undertaking (PSU).

“It could be a welcome step if higher incentives are extended to create a conducive industrial ecosystem. And this policy should be the same for other states as well. However, currently, the Centre’s approach seems to favour Gujarat, which is the Prime Minister’s home state,” the Karnataka Minister said while voicing concern that this could lead to disparity among states.

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(With PTI inputs)

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